BT lifts revenue guidance as profit rises 13%

SimonKennedy

LONDON (MarketWatch) -- U.K. telecoms company BT Group
BT.A, -0.27%
said Thursday that its second-quarter net profit rose 13.2% to 428 million pounds ($710 million), helped by a tax gain, as it also lifted its outlook for revenue and cash flow. The group said pretax profit excluding one-off items fell 6% to 461 million pounds and revenue declined 3% to 5.12 billion pounds. Earnings before interest, taxes depreciation and amortization rose 2% to 1.44 billion pounds and beat the 1.37 billion pound consensus forecast. The company said its troubled global services unit reported an improvement in operating earnings compared to the first quarter and added that it had achieved total cost reductions of over 900 million pounds in the first half. BT said it's now targeting total underlying cost reductions of at least 1.5 billion pounds, compared to its previous forecast of "well over" 1 billion pounds. It also raised its free cash flow target to at least 1.6 billion pounds from over 1 billion pounds and said it expects revenue to decline by between 3% and 4%, compared to the previous forecast of a drop of 4% to 5%.

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